Women’s Financial Inclusion: A Reason to Celebrate
By Dr. Alfred Hannig, Executive Director, AFI
It gives me great pleasure to wish everyone a very Happy International Women’s Day! Every day should be women’s day, but this day is an opportunity to take stock of how far we have come in the women’s financial inclusion space and, yes, there is certainly lots to celebrate.
For starters, equality is no longer considered “just a women’s issue.” Instead, the global consensus is that as a major economic and business concern and it is, therefore, imperative to ensure that women can play a full and active part in their societies.
This inclusion of gender considerations in policy work is central to the AFI network and is enshrined in the Denarau Action Plan, which identifies ways that members can take action to fulfill their commitments to halve their financial inclusion gender gaps by the end of 2021. While overall this gap has remained at a stubborn nine percent in developing economies with only 59 percent of women and 67 percent of men being banked, I am pleased to share that on a country level AFI members are making significant progress towards closing this divide in their respective jurisdictions.
Tanzania’s National Financial Inclusion Framework, which is a Public-Private Stakeholder Initiative, was launched in December 2013. Thanks to the digitization of financial products and delivery channels, and the development of new gender-sensitive products such as transactional mobile bank accounts and credit scoring models that assist women and other underserved segments, we now see an over 70 percent increase in women accessing, using and benefitting from financial services in Tanzania.
AFI members are engaged in collecting essential sex-disaggregated data that support closing existing gender gaps and contribute to the broader goals of full financial inclusion. The Palestine Monetary Authority has used such data to support the development of its national strategy for financial inclusion. As of July 2019, Palestine has increased the number of women with bank accounts to 40 percent from just 15.4 percent in 2014.
Central banks have been actively identifying and removing obstacles to women’s financial inclusion in order to pave the way towards closing the gender gap in this area. In Ghana, creating access to mobile money agents is crucial to women and, thanks to interventions from the Bank of Ghana, the country is on track towards increasing women’s access to financial services to 65 percent by November 2020.
These are some examples of how policymakers and regulators can make a difference to the lives of millions of women around the world. According to a study by the International Monetary Fund (IMF), narrowing the gender gap fosters greater stability in the banking system as a whole and enhances both social and economic growth in the country. The study found that women entrepreneurs who open even a basic bank account tend to invest more in their businesses, and that women-headed households are also inclined to spend more on education upon opening a savings account.
Interestingly, the IMF paper also provided insight into how the presence of women on bank boards is associated with greater financial resilience.
I applaud the AFI Gender Ambassadors, who came together in Kigali, Rwanda, September last year, and how they are leading the way towards closing the gender gap and supporting women’s leadership within their own institutions.
Having strong women role models does not only inspire young girls to dream big, but also reflects the aspiration of a country towards gender equality. For this reason, AFI and Women’s World Banking led the second installment of a nine-month long Leadership and Diversity for Regulators Program, supported by Visa Foundation and Oxford University Said Business School.
With just over a year to go until members fulfill their pledge to halve their financial inclusion gender gap, we are excited to see how the Alliance continues to create milestone after milestone in the women’s financial inclusion space.
Now is not the time to slow down.
Now is the time for us to accelerate our efforts towards ensuring that by the end of 2021, we will not only be reaping the benefits of a much narrower gender gap but that we will be able to see its closure on the horizon and know that we all had a role to play in this success.
AFI's Gender Inclusive Finance workstream is financed by the Swedish International Development Cooperation Agency (Sida) and other partners.